Assessing a top home based business is no different from assessing any business, i.e., there are a few basic components that need your attention. Prior to investing your time and your money, it would be wise to consider the following:
- 1. The product
- 2. Ownership experience
- 3. Timing
- 4. Leadership
- 5. Compensation plan
Initially, a business must have a line of products (or services) that are high quality and differentiated from its competition. A robust home based business will offer products that consistently deliver high quality, have a unique benefit/feature set and possess a limited availability. Additionally, to the extent possible, there will exist an element of obsolescence in order to create repeat business. Finally, the price must be competitive relative to similar products and still provide the business with an operating profit.
A second area of importance is the ownership. A top home based business will source its products from a manufacturer or provider who must not only understand the needs of the home based business but also be committed to the home based business model. A trust must be established between the company and the home based business in order for long term viability to occur. The top home based business owner must carefully vet the ownership prior to commitment.
Understanding the general trends of today’s market is primarily about timing. A strong home based business opportunity will consider current market trends such as:
- 1. Outsourcing
- 2. Offshoring
- 3. Technology and technical capabilities
- 4. Logistics and delivery
- 5. Customer experience
- 6. Costs and barriers to entry
A solid home based business will take advantage of outsourcing and offshoring, two very powerful trends, by allowing displaced workers an opportunity to take their skills and use them in their own home based business. Another trend that a top home based business would exploit is technology and the ease at which to connect digitally from the home based business to other businesses up and down the supply chain, as well as with your own potential customers and clients. The best home based business would use ubiquitous technologies (the Internet, telephony) to grow their sales, both locally and at a distance. The ability to drop ship product to a client is another current market trend, allowing the top home based business owner to avoid costly inventory by simply directing orders to the customer’s final destination. Another critical trend is to understand and leverage the customer experience. In today’s market, the business that has both high touch and high tech, wins. Finally, if your home based business opportunity costs too much or is too difficult to get off of the ground, it’s not one you want to pursue.
Probably most important of all is the leadership. Most home based business owners are new to owning and operating a business and require coaching and tools in order to ensure success. The top home based business will have leaders who are experienced thoroughly commitment to the home based business model. In addition, leadership must be able to provide affordable and effective with which to build the business. This level of support cannot be understated, as most businesses fail not due to undercapitalization but the lack of education and support.
Finally, the top home based business will include a compensation plan that is fair and will scale upward as you commit to and grow your business. The compensation plan should be based solely on product movement, i.e., plans that pay for building a team without product sales will run afoul of the FTC. The top home based business will reward the team concept but the underlying economic event will be the sales of your product.
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